Silver Price Forecast: XAG/USD climbs but fails to recapture $25.00 on a firm greenback

Silver (XAG/USD) is barely advancing for the second consecutive day amid a stronger US dollar courtesy of Russia-Ukraine jitters and Russian President Putin’s natural gas decree triggering a downbeat market mood. During the North American session, XAG/USD is trading at $24.93 at the time of writing.

The market mood is downbeat on Russo-Ukraine jitters and Putin's decree on natural gas payments

Global equity markets reflect investors’ negative sentiment as March is about to end. The greenback remains in the driver’s seat, as portrayed by the US Dollar Index, up 0.38%, sitting at 98.204, opposite to falling US Treasury yields, led by the 10-year benchmark note rate at 2.323%, three basis points down on the day.

The Russia-Ukraine conflict continues, putting aside peace talks, as Russian troops are redeployed towards the Donbas region. Also, Russian President Vladimir Putin signed a decree which states that Russian natural gas will need to be paid in roubles while saying that proceedings in euros or US dollars could also be blocked. If demands are not met, current contracts will be halted.

Meanwhile, oil prices fell following the announcement, while the greenback and safe-haven precious metals like gold and silver rose.

The US economic docket featured the Fed’s favorite gauge of inflation, the Core PCE for February, which rose by 5.4% YoY, lower than the 5.5% estimated, while US Initial Jobless Claims for the week ending on March 26 increased by 202K, higher than the 197K expected.

XAG/USD Price Forecast: Technical outlook

After Tuesday’s price action, which formed a large hammer in a downtrend, that touched the 200-day moving average (DMA), silver settled around the $24.50-$25.00 area for the last couple of days. That means that XAG/USD might consolidate before resuming the uptrend, as long as it stays above January 20 daily high, resistance-turned-support at $24.07, just above the 200-DMA.

That said, the XAG/USD first resistance would be $25.00. A decisive break would expose a downslope trendline, drawn from March highs, which confluences with November 16, 2021, daily high at $25.40, followed by March 24 daily high at $25.85 and the $26.00 mark.